Today’s stock market: In the medium term, analysts predict that a fall below the Nifty’s immediate support level of 18,350 might push the index as low as 18,150 to 18,100 levels.
Today’s day trading guide: Following a worldwide sell-off caused by the US Federal Reserve’s suggestion that the rate-hike cycle won’t finish anytime soon, Indian markets saw a reversal of their two-day rally on Thursday. The Nifty 50 index fell 245 points to conclude at 18,414, the BSE Sensex down 878 points to end at 61,799, and the Nifty Bank index fell 550 points to finish at 43,498.
Following Nasdaq losses, selling pressure increased on IT equities, and cyclical industries like metals and real estate are now feeling the heat. Although profit-taking was evident throughout the market, the loss in the advance-decline ratio was slightly smaller, falling to 0.48:1.
Stock market gurus claim that on Thursday, following a brief uptick, a lengthy bear candle was created on the daily chart. Technically, this pattern shows that the market is about to reverse sharply downward after forming a lower top on Wednesday around 18,696 levels. This is not encouraging and shows more short-term weakness.
Today’s stock market: Friday day trading tactics
Releasing recommendations for intraday trading on Friday, At HDFC Securities, Nagaraj Shetti is a technical research analyst “After a brief pullback recovery lately, the short-term trend of the Nifty appears to have changed to the downside. Nifty’s immediate support is located around 18,350, and a decline below this level in the near term might cause the index to drop as low as 18,150 to 18,100 levels. The Nifty 50 index’s nearest point of resistance is around 18,550.”
Regarding the forecast for the Bank Nifty, Head of Research at Swastika Investmart, Santosh Meena, stated: “Bank Nifty, the index that has been driving the current bull market, saw an evening star candlestick pattern and closed below its 9-DMA for the first time in two months. Below this level, there is a possibility of profit booking, with 42,625 acting as the next support level. A 20-DMA of 43,200 will work as an immediate support.”
Data on attractive call-put options
Shilpa Rout, Lead Derivatives Analyst at Prabhudas Lilladher, commented on the Nifty call put ratio as follows: “Up until 17500PE, PE writers added over 20 lakh shares of open interest to their positions in the Nifty weekly expiry option chain, with the maximum number of new additions occurring at 18400PE, or over 17 lakh shares. The maximum exposure for CE authors is 18600/19500 strikes, each with about 55 lakh total shares outstanding. At about 1, PCR OI at 18500 should provide quick help.”
Data for the Bank Nifty call put option
“On a weekly basis, the Bank Nifty option chain shows that 43000PE has the largest exposure of 10 lakh shares OI, with aggressive new additions at 41000/42000 strikes on the Put side. Over 25 lakh shares OI from CE writers who are active near the 44000 strike are shown in the data, which also highlights the upside resistance at the 44000 zones “said Parekh.